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Joining me now obviously JPMorgan's chief equity strategist great to have you with a -- -- Based -- relive this market.
Putting on quite a show this week and in particular the financials I mean the store the bank stocks can't.
Ben Bernanke I -- have done them a bigger favor cutting.
Perhaps not but mean you know the that the country needs healthy banks so I think you know financially cannot protest regularly country has -- Yeah I want everybody to be able to to participate and prosperity.
Of the banks leading the way I think most people were a little surprised by that back.
-- that absolutely I mean down.
You know I think one thing that's still very sort of not consensus what catches must -- by -- how well the stock market's doing this year.
But maybe even more importantly that it's being led by financial stocks -- financials are up almost 20% year to date.
And it's surprising because it's still a group that's under owned.
But it's a group that really benefits from -- -- improving situation in Europe and improving US housing market.
And effective valuations are record low so there's a lot of things that are setting curtail -- for -- group.
And with those tail winds and it's nice to talk about.
About a group or any in any industry.
Without talking about headwinds.
But coming next week we've got a lot of reports on on the housing markets.
Give us a sense of what you're you're looking out for on the for the financials.
Yeah com well yeah EO next week it's gonna be pretty you know there's a lot of data next week I think the thing that.
That's really gonna stand -- -- -- -- HB home builder survey you know that it's a measure of sentiment by the builders and that's really.
I last month broke out to a five year high and I think it's we know where expect me continue.
Any -- is that builders are starting to see customers.
You know respond to the fact that it's much cheaper to buy a house now than to -- there's pent up household formation.
Of course restricted lending is still very tight because home prices haven't picked up yet.
-- -- wants to do I think that's a big benefit for banks and aunt who's who's in this market right now the retail investor has been absent for some time.
Who who's out there behind I mean this is yeah this is something that -- I'm I'm curious about.
Because you're talking about three and I have -- -- for four billion shares is a big day.
-- -- -- -- -- -- -- -- it's a good question.
You know -- other retail is really not participating this.
You know the last five years -- -- 300 billion dollars the stock market.
-- you know.
-- when you get retail survey's overall sentiment if you average doubt is worse than it was in March 09 and march 2003 that chart it's another exit -- -- -- -- three Erica well.
-- was better.
But the real driver for the market it's double for the last three years as corporate buybacks corporate buybacks have been almost a trillion dollars for the last.
And that's really what's propelling the stock market pension funds insurance companies hedge funds and actually taken money out of equities.
So this is really been a rally that's benefitted primarily corporates and those -- -- held on -- their stocks right.
Well you expect this moved to keep to keep on the rolling.
Yeah I think that I think there's real constellation of positive factors coming together you know I think US housing is showing a lot of life -- at such a huge -- -- economy.
Europe is no longer but now headwind infect the yield curves are steepening I think Europe's -- and will soon be talking my European expansion.
Men taken out of emerging markets -- start to see central -- -- there those are all very bullish for equities I think it's just a matter time before people start talking about.
S&P testing -- 2007 highs all right well we're from -- revive them and one -- -- -- to leave them.
Always good to see you conversely we appreciate great seeing you thanks.
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